Private equity firm Blackstone has struck a deal to buy a majority stake in Indian online learning Simplilearn from its venture capital investors, marking its maiden bet on an Asian consumer technology player.
The move comes barely three months after Blackstone sold test prep firm Aakash Educational Services to Byju’s in a stock swap deal that gives the PE firm Blackstone a stake in the ed-tech unicorn.
Amit Dixit, Head of Asia for Blackstone Private Equity, said that this is the firm’s first PE investment in Asia in a consumer technology company. “Like many other sectors, technology is disrupting education and education technology has been a high conviction theme for Blackstone in India and globally,” he said.
The transaction will lead to the exit of Simplilearn’s venture capital investors Kalaari Capital, Helion Venture Partners and Mayfield Fund, which had invested a total of $28 million and owned a 57% stake.
Neither Blackstone nor Simplilearn disclosed the deal value. However, multiple media reports said the deal value was $250 million and valued the company around $400 million.
This would translate into 5-10x returns for the VCs with Kalaari bagging much of the gains as an early institutional investor. Notably, this adds to a string of Kalaari portfolio companies that have been acquired by Reliance Industries as a group. Reliance also happens to be a key Limited Partner with the VC firm.
Simplilearn, which offers digital skills training, is based in San Francisco and Bengaluru and is led by founder and CEO Krishna Kumar.
“The pandemic has only accelerated the need for digital skills and the industry has demonstrated absolute readiness for upskilling online. Hence, this is the most opportune time to take the next big leap in our journey to build the world’s largest digital skilling company,” Kumar said.
Simplilearn began operations in 2010. It offers more than 100 programs in digital skills across areas such as cloud, DevOps, data science, artificial intelligence, machine learning, digital marketing and cybersecurity. The company has tie-ups with many global and Indian universities to offer learning programs. These include Caltech CTME, MIT Schwarzman College of Computing, Purdue Online and IIT Kanpur, and companies such as IBM, Microsoft, Amazon, Facebook and KPMG.